Title 5 Premium Pay

In addition to overtime discussed on the overtime page (link to FLSA page), the Federal Employees Pay Act found at 5 U.S.C. §5542 sets forth other types of premium pay to which employees are entitled. The laws and regulations pertaining to premium pay are quite complex, and their interpretations are often dependent on specific factual circumstances.

While we welcome you to read the information contained below, we also invite you to call or email the firm today to discuss the specifics of your situation.

Sunday premium pay is pay that an agency is obligated to pay to employees whose regular hours of work include time on a Sunday. Significantly, if any part of the employee’s 8-hour shift falls on a Sunday, the employee is entitled to additional pay equal to 25% of the employee’s pay for that shift. In 1998, the law was amended to require that the employee actually work part of the shift to be eligible for Sunday premium pay. Previously, employees who were scheduled to work on a Sunday, but did not do so because they used paid leave were entitled to Sunday premium pay.

If an employee has two shifts that fall on a Sunday – such as an employee who works 11:00 p.m. on Saturday to 7:00 a.m. on Sunday and then from 11:00 p.m. on Sunday to 7:00 a.m. on Monday – the employee is entitled to receive an additional 25% pay for two shifts. In our experience, some employers have erred in applying this rule by only paying the additional 25% Sunday premium pay for one shift.

Night shift differential is paid to employees whose regularly scheduled hours fall within the hours of 6:00 p.m. and 6:00 a.m. It equals ten percent of an employee’s basic pay for the shift. It is paid to employees if they work any part of their 8-hour shift between 6:00 p.m. and 6:00 a.m. In addition, it is paid if due to absences of leave due to holidays, an employee works only part of his scheduled 8-hour shift. It is not currently paid to employees if they miss their entire 8-hour shift due to using paid leave.

For Wage Grade Employees, Night shift differential is paid to employees whose regularly scheduled hours fall within the hours of 3:00 p.m. and 8:00 a.m. If a majority of an employee’s regularly scheduled non-overtime hours occur between 3 p.m. and midnight, an employee is entitled to receive an additional seven and a half percent (7 ½%) of his basic pay for the shift. If a majority of the employee’s regularly scheduled non-overtime hours occur between 11 p.m. and 8 a.m an employee is entitled to receive ten percent (10%) of his basic pay.

An employee regularly assigned to a night shift is entitled to receive the night shift differential during paid leave.

Employees who work on a recognized holiday – i.e., a holiday that is established by statute or Executive Order – are entitled to receive their basic pay plus pay at a rate equal to their basic pay for the first 8 hours worked on the holiday. In other words, employees who work on a recognized holiday are entitled to receive double pay for the first 8 hours they work on the holiday. Thereafter, the same rules for Title 5 overtime pay that apply to overtime work on a regular workday apply to overtime work on a holiday.

An employee who is required to perform any work on a holiday is entitled to pay for at least 2 hours of holiday work.

Holiday pay is in addition to Sunday premium pay and night shift differential.

This is one of the least used forms of premium payments agencies make to their employees. We are unsure of the reason why, but speculate that it may be because both agencies and employees remain unsure of the circumstances under which this type of premium pay is required.

Federal employees are entitled to receive additional pay if they are exposed to certain types of hazards or unusual physical hardship. Hazardous duty is defined by OPM as hazards in which an accident could result in serious injury or death.

OPM is authorized by Congress to establish the types of hazards to which an employee’s exposure mandates the payment of hazardous duty pay. These range from exposure to toxic chemicals, virulent biologicals or incendiary materials to underwater duty or exposure to extreme heat.

OPM has established a list of hazards to which a federal employee’s exposure mandates the payment of hazardous duty pay. This list is called “Appendix A” to OPM’s hazardous duty pay regulations. Agencies may petition OPM to add to the list of hazards that appears on Appendix A.

Exposure to one of these hazards results in the employee being entitled to receive an additional payment of between 10-25% of his basic pay for that day. The amounts are determined by OPM.

Until 1990, exposure to the hazard had to be intermittent or occasional to qualify for hazardous duty pay. Since 1990, that has no longer been true. All that is required is that the employee be exposed to the hazard, regardless of how often this occurs.

It is a defense to payment of hazardous duty pay if the employer has taken the hazard into account in classifying the employee’s position. OPM has defined the phrase “taken into account in classifying the position.” OPM defines this phrase as meaning that an employee can use his knowledge, skill and abilities in that position to reduce the risk of the hazard. For example, fire fighters would not be entitled to receive hazardous duty pay for fighting a fire.

On the other hand, agencies can seek a waiver from OPM so that they can pay hazardous duty to employees who are exposed to a hazard, even where the hazard has been taken into account in classifying the employee’s position.

Wage Grade employees are not entitled to hazardous duty pay. Instead these employees are entitled to environmental differential pay (EDP). An employee is entitled EDP when exposed to a working condition or hazard that falls within one of the categories established by the Office of Personnel Management (OPM). The list of hazards approved by the Office of Personnel Management is listed in “Appendix A” to OPM’s environmental differential pay regulations. To view a list of these hazards click here. (link to OPM Appendix A)

Environmental differential pay is part of an employee’s basic pay and is used to compute premium pay (i.e. pay for overtime, holiday or Sunday work).

In Title 5 premium pay cases, employees are entitled to receive the difference between what they were paid as Title 5 premium pay, if anything, and what they would have been paid had they been paid properly. In addition, the employees can recover interest on their backpay damages and attorneys’ fees and costs.

The statute of limitations in Title 5 premium pay cases is six (6) years. This means that employees who are seeking back pay for premium pay that they were improperly denied can recover backpay going back 6 years from the date that their claim is filed in court or from the date a grievance is filed.

Employees can pursue Title 5 premium pay claims in court or, if they are represented by a union, through the negotiated grievance procedure. Claims for more than $10,000 in damages must be pursued in the U.S. Court of Federal Claims if they are pursued in court. In other words, local U.S. District courts do not have jurisdiction to hear an employee’s claim seeking damages in excess of $10,000.

In 1998, Congress enacted a new pay law for federal fire fighters. The new pay law eliminated the application of the standby pay law. Instead, federal fire fighters who perform 24 hour shift work are paid an hourly rate that equals their annual pay divided by 2756 hours. Then, for each hour that a federal fire fighter who is covered by the FLSA works or is in a pay status in excess of 106 hours in a 14-day pay period, the fire fighter receives one and one-half times (1.5) his hourly rate of pay.

Federal fire fighters who are FLSA exempt have their overtime pay computed at one and one-half times their hourly rate of pay, the same as non-exempt fire fighters, unless their rate of pay exceeds the rate of time and one half of a GS-10, step one. The time and one-half rate of an FLSA exempt fire fighter is computed by dividing the fire fighter’s annual pay by 2087 hours and comparing that to the hourly rate derived by dividing the annual pay of a GS-10, step one by 2087 hours. This formula only applies to fire fighters who are exempt from the FLSA.

Federal Fire fighters who work tours of duty other than the 24 hour shift work of most federal fire fighters have their pay computed in a different manner.